Amazon billed by Arizona for $53 million in sales taxes

Amazon claims that the state of Arizona has served the online company a tax bill for $53 million for uncollected sales tax.

According to Amazon's Form 10-K, which the company filed with the Securities and Exchange Commission (SEC) on Wednesday, Arizona in November assessed Amazon's unpaid taxes for the state and certain cities at $53 million. This includes tax and interest for uncollected tax from March 1, 2006 through Dec. 31, 2010.

According to the filing, Arizona claims that Amazon should have collected transaction tax similar to sales tax on applicable transactions during those years.

Amazon did not immediately respond to requests for comment.

However, in the filing, the company expressed contention over the tax bill. “We believe that the assessment is without merit and intend to vigorously defend ourselves in this matter,” stated Amazon in the 10-K form. “Depending on the amount and the timing, an unfavorable resolution of this matter could materially affect our business, results of operations, financial position, or cash flows.”

Anthony Forschino, assistant director at the Arizona Department of Revenue, declined to comment. He said via email that taxpayer confidentiality laws prevent the department from commenting on tax liability of any particular entity.

For years, Amazon has been battling states from California to New York to keep consumers from having to pay sales tax on goods purchased online. In July, when California's State Assembly passed an Internet tax bill extending the state's 7.25% sales tax to online retailers, Amazon fought back and cancelled advertising contracts with all of its California affiliates. Lawmakers in Illinois, Arkansas, Connecticut, North Carolina, New York, Rhode Island, South Carolina and Texas have all pushed to collect sales tax for goods sold online.

In November, Amazon expressed support for the “Marketplace Fairness Act,” a bill that would restore each state's sovereign right to enforce state and local sales and use tax laws, but would exempt online retailers with less than $500,000 in annual revenue from collecting and remitting sales or use taxes.

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